WEBVTT
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In this Excel tutorial I'm going to show you how to find a future value
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given that you're have an A or how to find F given A.
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Now notice here in the spreadsheet that I have some information.
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Say I have a savings account that pays me weekly interest of point 0.05 percent,
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out of my paychecks I can handle about $25 a week I could put away
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and I've got 24 weeks before I head out for spring break.
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So how much money am I going to have available to go to spring break.
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Well let's take a look.
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You can simply go to the cell and type equals.
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Now in this case we're looking for a future value in an Excel that's FV,
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so I’m simply going to type FV, start my parentheses and notice this is,
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I find this odd that Excel does this sometimes in previous tutorials you've seen this little thing
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right here come up under my formula bar, but in this case it came up right underneath the cell.
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So, just follow along.
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The first thing it’s asking for is what is our rate? Our rate is in B2 comma,
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notice the comma moves me now to, what are you, how many weeks are we doing Nper is in.
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And I just click cell B4
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comma payment is what they consider an Excel to be an A.
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Remember an A is a uniform payment, such as a car payment is a same amount
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you pay every month or perhaps a mortgage.
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So I do comma and my payment is $25 per week and I don't have a present value
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and I don't have a type so I can simply close my parentheses and hit return
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and what this says is that in the future, oops! It says I will have a negative value.
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In order to you to fix that I need to go to the formula where it has weekly deposits,
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that's money and putting away.
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So B3 apparently needs to be negative. I need to put in the right spot or it'll give me an error, okay.
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And it says in the future I’d have $603.46 for spring break.
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So that's one way you can do this calculation.
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Another way is to say, well hey, I need a $1000 for this spring break trip,
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so how much money am I going to have to put away per week out of my paycheck
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to be able to do this?
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So, here what you're solving for is you're solving for the A
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and you can use a very similar formula.
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If you're looking at these are a lot of in these tutorial
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it is the same formula they just twisted a little.
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So in this case remember an A is represented by PMT in Excel, so I hit just
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simply type equals PMT start my parentheses and it asked for my rate
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and that was B2 comma, my n, which was 24. Then it asks, I don't have a present value
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so comma but to skip to the next one I’m just comma again.
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Future value I want is $1000 and that's all I have so I close the parentheses.
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And that tells me that I need to deposit $41.43 per week.
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Notice it's in the red with the parentheses that's Excel’s way of saying that it's a negative value.
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That's money that you're putting away every week
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so that you would have $1000 to go on spring break.
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In this tutorial I've shown you how to solve a future value when you have an A
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or how to solve for an A when there's some future value that you want.